Risk Management
Wish List

Gloria Brosius — Pinnacle Agriculture

Wish No. 1: Offer me deductible options that make sense.

I frequently get low deductible options, which may sound appealing until you look at the high premium. When I ask for higher deductibles (and presumably, lower premiums), it doesn't make financial sense to move to that higher deductible.

With Pinnacle, in particular, we're a fairly new company. We started business in 2012. Initially we took low deductibles because we weren't sure what our risk appetite was at that point. As we have become a more mature company, we know we can take higher deductibles. But oftentimes when we ask for the higher deductibles, the correlating premium relief isn't there. So it doesn't make sense for us to take the higher deductible, even though we want to. The premium needs to correlate better to the higher deductible.

I think insurance companies want to be taken out of the working layer of the claims. If Pinnacle, or any company, is willing to take on a higher deductible and keep that insurance company out of the working layer of those claims, the premium relief has to be there so that it makes sense for us financially to do so. But the premium relief has to be there.

Insurance companies need to do a better job of re-looking at that premium when a company is willing to take the higher deductible.

Wish No. 2: Know my company and why my risk is (or isn't) different than everyone else's.

I make every effort to distinguish my company from all the other insureds that my underwriters may come across, and my wish is that they have a true understanding of my business. Read the materials I give you during our meetings, and ask me questions.

For the most part, my partners in the industry understand the differences between my company and others. My wish is for that understanding to continue.

I work very, very hard to make sure they understand my business and why I'm different from other agriculture companies. When I meet with a new potential partner, a new insurance company that's not on my coverage, I go into deep explanations and I really want them to understand.

We work with a lot of chemicals, but we don't manufacture. A lot of times an insurance company will hear the word chemical, and they start backing off right away because they don't want to deal with that. But we are different in that we don't manufacture the chemicals. We apply them.

That often is a very deep explanation that I have to go into with the insurance companies, to make sure they understand our risk is lower than someone who actually does the manufacturing of the chemicals.

I like to have face-to-face meetings with underwriters and insurance companies because that's one way to remember me, and to remember Pinnacle Agriculture as being a little bit different from what they might have lumped me in as. So I think that face-to-face interaction is important.

And giving them documentation that they can take back to their office and remember you more clearly when they're doing the actual underwriting is important.

Andy Barile — Alternative Global Risk Management Inc.

Wish List: Provide up-to-the-minute accurate loss runs and explain the loss development factors you use.

The system now is the risk manager will go to their retail broker, and it's up to the retail broker to go to the insurance company to get up-to-date loss runs. With the new technology that's being developed, it all sits with the insurance company spending more money on IT than they did in the past.

In the past, with that kind of request, you'd have to wait because the claims department hadn't updated the loss reserves. Now, the claims department has been spending money to update it because they want to know who's costing them money and who isn't.

Risk managers need to know that information too, because that's how carriers are going to price the product. If they start realizing the losses are greater than the premiums, the risk is going to be renewed at a higher price.

So [updated loss runs] allow risk managers to make changes. Once you train the risk manager to be intelligent enough to understand that his premium is predicated on the losses he has, he should be requesting this information not just three months before the policy is due for renewal, but much more frequently. It should be coming in monthly, depending on the size of the client and the number of claims there are.

We're accelerating the information process.

The old traditional way was no one worried about it until two months before the policy was to be renewed. But now the smarter risk manager says, 'We need to know how we stand with our workers' comp or our GL or our auto with the carrier.'

It's one of the new dimensions that technology is bringing to the business. It's also the acceleration of the risk manager's understanding. They're not going to let the broker negotiate the renewal without understanding what's driving the price. But they're spending more time chasing this information down because it's not being proactively offered.

Patrick Sterling — Texas Roadhouse

Wish No. 1: Simplify the application process.

That is always a pain point. It takes a lot of man hours to get all that data together. I wish there was some way the industry could get together and simplify the application process. That's one thing that would save a lot of time.

It's all lines. Each one is unique. It would be nice to have a standard form or even just a database. It's a complicated, time-consuming process, and it seems like we should be able to simplify it.

You'd think with today's technology we'd be moving to a more modern, or even paperless, process.

Wish No. 2: Offer more flexibility for designing coverages.

Make it easier to create unique coverages based on the industry you're in. Instead of having to go form a captive, it would be nice to have more flexibility in coverage design.

Wish No. 3: Know our business.

I like it when they come visit us, versus us having to go visit them. I like them to understand our company, experience our culture, know our business well. Especially with us being in the restaurant business, I want them to have dined in our restaurant. That's important.

I want them to see our passion for excellence, our level of customer service, our culture of being the friendliest place in town, our culture of partnership. We like to do business with people that have similar beliefs as we do on things like partnership and customer service.

Wish No. 4: Be there when we need you and stick with us.

It may seem obvious. But when you have that claim that you hope you never have, you don't want them to make the claim process difficult

I've had good and bad experiences. We had one carrier who did a phenomenal job and stuck with us. Even on renewal they didn't take a draconian approach toward the renewal. They were a great partner. They stuck with us and showed they believed in us. They didn't kill us because we had the bad claim. And I had one carrier who did just the opposite.

Obviously, our goal is not to have claims, so the more they can be a partner in our risk program, the better. I always love the freebies, the free training, where they bring in expertise to help educate our teams. That's always very much appreciated. Our EPL excess will reimburse a certain dollar amount for training. That sends a good message. It doesn't cover all of our training, but the fact that they cover some makes it a good partnership.

Wish No. 5: Offer multiyear deals.

Then I'm not having to apply every year. It's more predictable on our program and cost of risk.

Simon Keshishian — Red Bull North America

Wish No. 1: Really understand claims handling.

Everyone offers customer service and says they're around 24 hours a day. As a practical matter, that comes in handy once in a while. For me, having an organization that really understands claims and claim handling is paramount to anything. Ultimately, you can have the risk profile and the insurance, but if they don't deliver on their claims promises and resolve claims efficiently, you're throwing money out the window. The key for me when I look to risk carriers is what their claims departments look like.

When I started 20 years ago, adjusters were more generalists. They had an understanding of how the big picture worked. As we've gone to a more technological focus, we're getting more specialized. As you get specialists who are really good at one thing, they lose the forest for the trees on some of the other stuff. So even though it's great to get a specialist on a certain type of claim, if they don't know how to subrogate or don't know the interplay of policies and which should be triggered, it becomes more of an effort on my part to educate the adjuster or the carrier. I have to follow up and spend a lot of time. So I've seen an improvement on specialty, but that also detracts sometimes.

Wish No. 2: Train adjusters better.

Training of adjusters is one of the biggest problems I'm seeing. Not necessarily with my own carriers. We're self-insured to some extent. We have big deductibles. So we have the same group of adjusters we're dealing with. But when I have a claim I'm tendering—I do a lot of risk transfer—and I'm dealing with other insurance carriers, I feel like I spend a good deal of time training adjusters because they don't understand the basis of the tender, what I'm sending over, or the coverage of a different line. They raise liability defenses when they should be talking about coverage defenses. Or vice versa. That's been a struggle.

When I started 20 years ago, training was part of every adjuster's road to becoming a claim handler. Now it seems like that's not happening. Maybe it's because people were getting trained and going across the street and taking a job elsewhere.

Wish No. 3: Modernize your technology.

Everyone talks about technology and everyone has some sort of electronic claims system. But instead of emailing me accident scene photos or a police report, they'll still send me a CD-ROM. It's 2019! They should be investing in scanners that are effective and make sure they're leveraging cloud solutions. Sending a CD-ROM is not a practical way to do things. Spend the money and get a cloud account.